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Weekly Outlook | Wild price swings amid new tariffs
Updated Updated Tue, 2025 February 18 05:23
Important events this week:
Last week, the Dollar lost steam during all five trading days. Currently it seems that market momentum might be in favor of the weakness to continue. One reason for the lower Greenback might be that the implementation of new tariffs in the US could cause the trust of the Dollar to evaporate. Also, the Dollar index shows a sharp decline based on the weekly chart. Will the reign of the Dollar finally change in the coming weeks ahead?
Furthermore, the upcoming PMI data from the Eurozone on Friday might give more clarity about the economy. German manufacturing is expected to rise slightly, whereas the sentiment in Germany remains weak and at ultra-low levels not seen in decades. The DAX currently trading close to its all- time high might face a volatile time during the data- release.
– AU- Interest rate decision- The Aussi has shown a remarkable recovery in the past two weeks. The positive momentum might cause the upside potential to increase for now.
The monthly chart above shows, that the upside could continue towards the 50- moving average, which would be one of the next limiting factors at around 0.6750. The market needs to break the horizontal resistance zone at 0.6400 initially, for the positive momentum to continue. An exclusion of newly implemented tariffs from the US could help, whereas the upcoming rate- cut might already be priced in for now. The interest rate decision will take place on Tuesday, February 18 at 04:30 CET.
– CA- consumer price index- The Canadian Dollar has geared up steam against most other currencies recently. In particular against the currently weakening US- Dollar the positive momentum could be set to continue. Consumer prices are expected to fall on a monthly basis; however, a positive surprise could also help gearing up the Loonie again.
The weekly chart of the USDCAD shows that a strong retracement has been happening, which might extend towards the important support zone at 1.3900. This is also, where the rising 50- moving average will act as an incoming support zone, potentially causing a bounce to the upside. The data will be released on Tuesday, February 18 at 14:30 CET.
– NZ- Interest rate decision- Similar to Australia, also the RBNZ might cut interest rates this week. The Kiwi is showing fresh strength in particular against the US- Dollar. The market shows a bounce off a strong support at 0.5550, which marks a “double bottom”.
Also, the candlestick pattern aligns with the positive momentum. A rate cut might now cause the NZD to weaken. If the support zone at 0.5600 won’t be broken this could act as fresh entry potential towards higher levels. The initial target could be around the upcoming resistance zone at 0.5800. The interest rate decision will take place on Wednesday, February 19 at 02:00 CET.
